Jane Prentice (Ryan, Liberal Party) Share this | Hansard source

As I was saying before the debate was interrupted, when Labor introduced the Banking Laws Amendment (Unclaimed Money) Bill 2015, I commented then that they needed to be aware of the unintended consequences. I said that taking over the accounts of people who have been saving money for travel and university would lead to problems. I urged Labor to withdraw the bill in order to facilitate further consultation. In the end, the chorus of opposition from the coalition and from stakeholders forced Labor to make seven amendments to their own bill. But the rest is history—the bill passed, and here we are three years later trying to clean up their mess.

Labor's undue haste and shoddy legislation belied the true purpose of this change. For all of their lofty rhetoric, it was always about a desperate cash grab to boost their flagging budget bottom line. In the financial year 2011-12, $70 million in unclaimed funds were transferred to the Australian Securities and Investments Commission. Under Labor's changes, in 2012-13 this figure ballooned to $550 million—an almost eight-fold increase in a single year. This also came at a human cost. As the minister detailed in his remarks, for many Australians funds that were wrongly claimed by government meant cancelled holidays and delays in purchasing new goods. It meant that people who thought they had money saved away were placed in needless financial difficulty. This policy was a travesty that should never have been allowed to happen. Labor should be ashamed of the contempt with which they treated parliament and the people of Australia in ramming through their legislation.

This bill seeks to restore the arrangements that existed prior to 2012. It restores a requirement that accounts must have been inactive for at least seven years before funds can be transferred to the Commonwealth. This will cost the government $285 million over four years but will save the community $36 million each year in reduced red-tape costs involved when people lose and are then forced to reclaim their accounts—indeed, their own money. That is not to mention the peace of mind in knowing that their accounts are in less danger of being seized by government. No longer will accounts set aside for family purchases and holidays be under threat. Under Labor's laws, accounts named 'Deposit for house', 'Family holiday 2018' or 'Funeral expenses'—accounts that had clearly stated purposes and were clearly not dormant—were targets for seizure by the government. Under this bill, accounts such as these will be protected unless inactive for seven years, not just three.

The bill will entirely exempt children's accounts and foreign currency accounts from unclaimed moneys provisions. This is a common-sense move. Many Australians set money aside for their children's future, and this money should never be transferred to the government. Foreign currency accounts are used by sophisticated consumers as collateral to settle transactions. For this reason, they commonly lie dormant for long periods until, or if, they are required. In the interest of avoiding red tape, the government should not interfere in this process.

Also contained in this bill are necessary changes to the way in which the personal information of account holders is protected by ASIC. Contrary to Labor's claims back in 2012, there is no law mandating that banks and/or life insurers alert their customers to their unclaimed accounts. This means that individuals are often required to personally access ASIC's unclaimed money gazette, which is published online. The gazette publishes detailed personal information, including name, last known address and the amount of money they have unclaimed. This creates two unintended consequences. The first is the potential for identity fraud. The second is the emergence, emboldened by the controversy surrounding Labor's changes, of a cottage industry of unscrupulous companies. These companies use this information to target individuals, often charging excessive fees to return so-called lost moneys despite ASIC offering it as a free service. Changes contained in this bill will remove the requirement for ASIC to publish the unclaimed money gazette and will ensure that only individuals with unclaimed accounts, or their agents, will be able to access their data through freedom of information requests.

Labor can try to sugar coat it all they want, but there is no denying that tinkering with policy on unclaimed moneys was an unmitigated policy disaster. According to the Australian Bankers' Association, complaints about the provisions increased 300 per cent following the introduction of Labor's changes. Industry was not happy; consumers were not happy. This is why the coalition government is more than pleased to reverse this policy. It is all well and good for a government to seek out savings measures, but stealing money from the bank accounts of average Australians is not the way to do it. It is this sort of cynical, desperate policymaking that got Labor into trouble. It is now the duty of the coalition government to restore fairness to the financial affairs of Australians.

I commend the bill to the House.

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